In a statement made during the International Economic Forum of St. Petersburg, Russia’s Minister of Economy, Maxim Reschetnikov, warned that the country is on the verge of an economic recession.
This statement occurs in a context of growing concern about the slowdown in economic growth and high interest rates that have been affecting Russian companies.
Monetary economic and political indicators
This month, Russia reduced its interest rates for the first time since 2022, lowering the cost of loans from 21% to 20%. However, companies have been expressing for months that high interest rates are suffocating investment. Reschetnikov mentioned that, although current figures show a cooling, business indicators suggest that the economy is about to enter into recession.
“According to the figures, there is a cooling, but all our figures are in the rearview mirror,” said Reschetnikov. “According to the current feeling of companies and business indicators, we are already, it seems to me, about to enter recession. On the edge.”
Opinions of experts and economic risks
In the same session, Elvira Nabiúlina, from the Central Bank, said that the current slowdown in the internal gross product (GDP) is “an overheating output.” This opinion reflects a more optimistic vision of the situation, suggesting that deceleration could be a necessary correction after an accelerated growth period.
On the other hand, Alexander Vedyakhin, first deputy CEO of the largest Russian bank, Sberbank, expressed concern about the risks of excessive cooling of the economy. In an interview with Reuters, Vedyakhin said that the strict monetary policy is creating risks of over)
“There is a danger that the economy cools in excess, that we are not able to get out of this bump and that growth remains moderate”said Vedyakhin.
Future perspectives
The Ressetnikov warning and the opinions of other economic experts underline the need for a careful and balanced approach to manage monetary policy in Russia. While the country navigates these economic challenges, it will be crucial to monitor business indicators and adjust policies as necessary to avoid prolonged recession.
In summary, Russia is in a critical moment in which economic and monetary decisions will have a significant impact on their economic future. The reduction of interest rates is a step in the right direction, but more measures will be needed to stimulate economic investment and growth.
Source: Ambito
